The Space Force has placed a defense contractor on a watch list designed to hold underperforming companies accountable for issues such as poor performance and cost overruns.

Space Systems Command, which has the authority to place contractors on the list, has never confirmed the use of this tool until this week.

“There is a company on the watch list today. I won’t say who it is,” Lt. Gen. Philip Garrant, commander of Space Systems Command, told reporters during the Defense Writers Group event Thursday.

The fiscal 2018 defense policy bill mandated the creation of what’s called a Contractor Responsibility Watch List, or CRWL, with the intent to track contractors with a history of poor performance. Currently, a contractor or subcontractor may be put on a watch list due to various reasons, including poor performance or award fee scores below 50%; financial concerns; felony convictions; and concerns related to security or foreign ownership and control.

Garrant didn’t identify the contractor currently on the watch list, but said the company contributes to a high-priority space program.

“I won’t get into specifics of which company. I will say the tool has absolutely worked as intended. We have seen significant improvement in performance and attention at the most senior levels of the corporation. The CRWL has absolutely worked,” said Garrant.

While only Space Systems Command can use the tool to hold contractors accountable, Air Force top officials have advocated for its broader adoption.

Frank Calvelli, Air Force space acquisition chief, said during a House Armed Services Strategic Forces Subcommittee hearing in May the tool could be “more useful” if applied more consistently.

“I would love to see the tool expanded and [authority given] to me as the service acquisition executive,” Calvelli said back in May.

Calvelli has long advocated for acquisition reform and the need to address inefficiencies in acquisition processes. He’s specifically been outspoken about  “troubled” programs in the Space Force that are years behind schedule, including the Next-Generation Operational Control Segment program, or OCX, which is a ground system needed to manage modern GPS satellites, and the Advanced Tracking and Launch Analysis System program, or ATLAS, which is a vital system for space command and control.

The House and Senate draft versions of the 2025 defense policy bill, however, the responsibility for the watch list would shift from Space Systems Command to Calvelli.

“Those authorities reside with me right now. The 2025 [National Defense Authorization Act] moves those authorities to the service acquisition executive, and Mr. Calvelli has indicated he would intend to use it perhaps more frequently when those authorities move,” said Garrant.

The 2025 defense bill would also expand the consequences for contractors put on a watch list. The bill would prohibit contracting officers and other officials from soliciting and offers or awarding contracts to CRWL-listed contractors; consenting to subcontracts with CRWL-listed contractors; executing nonprocurement transactions with contractors on the watch list and exercising options on any existing space procurement or nonprocurement transactions.

Under the proposed bill, a contactor on a watch list can only get an exception if the Space Service Acquisition Executive makes a written determination that there is a reason to do so. Subsequently, the Space Service Acquisition Executive would notify congressional defense committees, intelligence committees, and the Director of National Intelligence of the decision.

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